Pre & Post Market Trading Risk Disclosure
•
Risk of Lower Liquidity. Liquidity refers to the ability of
market participants to buy and sell securities. Generally, the more
orders that are available in a market, the greater the liquidity.
Liquidity is important because with greater liquidity it is easier
for investors to buy or sell securities, and as a result, investors
are more likely to pay or receive a competitive price for securities
purchased or sold. There may be lower liquidity in extended hours
trading as compared to regular market hours. As a result, your order
may only be partially executed, or not at all.
•
Risk of Higher Volatility. Volatility refers to the changes
in price that securities undergo when trading. Generally, the higher
the volatility of a security, the greater its price swings. There
may be greater volatility in extended hours trading than in regular
market hours. As a result, your order may only be partially executed,
or not at all, or you may receive an inferior price in extended
hours trading than you would during regular market hours.
•
Risk of Changing Prices. The prices of securities traded in
extended hours trading may not reflect the prices either at the
end of regular market hours, or upon the opening the next morning.
As a result, you may receive an inferior price in extended hours
trading than you would during regular market hours.
•
Risk of Unlinked Markets. Depending on the extended hours trading
system or the time of day, the prices displayed on a particular
extended hours trading system may not reflect the prices in other
concurrently operating extended hours trading systems dealing in
the same securities. Accordingly, you may receive an inferior price
in one extended hours trading system than you would in another extended
hours trading system.
•
Risk of News Announcements. Normally, issuers make news announcements
that may affect the price of their securities after regular market
hours. Similarly, important financial information is frequently
announced outside of regular market hours. In extended hours trading,
these announcements may occur during trading, and if combined with
lower liquidity and higher volatility, may cause an exaggerated
and unsustainable effect on the price of a security.
•
Risk of Wider Spreads. The spread refers to the difference in
price between what you can buy a security for and what you can sell
it for. Lower liquidity and higher volatility in extended hours
trading may result in wider than normal spreads for a particular
security.
• Risk of Lack of Calculation or Dissemination of Underlying Index Value or Intraday Indicative Value (“IIV”). For certain Derivative Securities Products, an updated underlying index value or IIV may not be calculated or publicly disseminated in extended trading hours. Since the underlying index value and IIV are not calculated or widely disseminated during the Opening and Late Trading Sessions, an investor who is unable to calculate implied values for certain Derivative Securities Products in those sessions may be at a disadvantage to market professionals.
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